PUTIN’S STATE OF THE NATION ADDRESS

By Elena Chinyaeva

Russian presidents, like their American counterparts, have a constitutional obligation to address lawmakers each year. This address, which in Russia is delivered to the Federal Assembly, has now become a fixture of the Russian political calendar. There have been ten presidential addresses so far–six by Boris Yeltsin and four by Vladimir Putin. The address provides an opportunity for the president to formulate the main directions of the country’s development–and an opportunity for analysts to pore over his tone and choice of words, seeking to discern the sub-text of his peroration.

And though it was conceived as a reflection of new democratic changes in Russia, the presidential address in fact reminds one of the report that the Communist Party general secretary delivered to the party congress, once every four years.

Obviously, presidential speeches are the product of a joint effort by a team of presidential advisers and speech writers, although Putin certainly leaves a more distinct stamp–one shaped by his own ideas–than did Boris Yeltsin. This is particularly true in the sphere of political governance. Thus, for instance, the idea of a strong state undoubtedly belongs to the president himself, even if the more precise formula of “strengthening the power vertical” may have originated with his advisers.

As to the economy, the president is widely known to be reluctant to make decisions on controversial economic issues, leaving it instead to opposing factions in the government to work out a compromise. The authorship of the ideas in his address that relate to Russia’s economic development can be quite easily attributed to one or another of his advisers, quite often to Andrei Illarionov.

There are three main themes around which all Putin’s addresses have been structured. They are the strengthening of state power, economic reform and social policy. In Putin’s first address, in July of 2000, he announced a plan for radical tax reform. And indeed, beginning on January 1, 2001, a flat 13 percent income tax and a unified 35.6 percent social tax were introduced. However, his other maxims–on the necessity of banking reform and improving the business climate–remained largely declaratory. Putin also announced in his first address that “without the strengthening of the state no national problem can be solved.” And the consolidation of central power has in fact become the main line of his internal policy. The administrative reform started with the reorganization of the Federation Council. In the course of a year, appointed senators were substituted for elected governors.

In his second address, delivered in April of 2001, Putin continued the theme of strengthening the state. In this context he emphasized the need to differentiate levels of responsibility between the center and the provinces and to “put in order inter-budgetary relations.” The government approved a program for the development of budgetary federalism, although the corresponding laws–on the common principles of legal and executive power and on local self-governance–were adopted only in 2003. He also declared the beginning of legal reform, and in 2002 a number of amendments and new laws on the courts and judges were approved that changed their role and status. As to the economy, the president pointed to the need to change its structure and continue the tax reform; beginning in 2002, the profit tax was lowered from 35 to 24 percent.

In his third presidential address, in April of 2002, Putin criticized the government for the caution it displayed in its growth projections. He also underlined the need to continue reform–of administration, taxation, and of the natural monopolies, including housing and utilities. But a year later nothing much has changed in any of these spheres. Economic growth for 2002 was 5 percent, 1 percent less than in 2001, and the reform of the natural monopolies and of taxation is progressing at a slow pace.

The latest presidential address differs from the previous ones in that it was overshadowed by the impending parliamentary elections, scheduled to take place in December, and the presidential race set for next spring. The address was therefore expected to include points that would help Vladimir Putin to maintain his high rating with the voters, and to bolster the chances of the pro-presidential United Russia party, which faces a tough race against the Communists for control of the State Duma. And indeed, the address did include such elements–although at the same time Putin condemned other politicians for making “promises which cannot be kept, under the cover of populist slogans.”

The president’s speech included some sharply critical remarks about the economic results of the past three years. Putin said: “I have to state that our economic achievements so far have been very, very modest.” He went on to lay down three goals for the next decade: A doubling of GDP; reducing the number of people living in poverty (currently, one in four of the population); and reform of the armed forces, including a shortening of draft military service to one year by 2008. He insisted that these goals could be realized without sacrificing the ongoing programs of economic reform.

It is an open question whether any of the goals can be realized. A doubling of the economy would require annual growth of 8 percent. But given the unchanged structure of the economy, the unfinished reform of the natural monopolies, and the weak banking system, that goal hardly seems realistic. This year the economy is growing at about 6 percent, and it seems likely that this rate can be maintained, at best, until the end of the year.

Poverty has proven hard to eliminate even in the most developed countries. Obviously, there will be fewer poor Russians if the economy grows quickly, but Putin’s address included no ideas regarding specific policies that might alleviate poverty. The president hinted at those who might be responsible for this state of affairs–the government–and offered one new idea: To form a government on the basis of a parliamentary majority.

This suggestion, more typical of a parliamentary democracy than a presidential system like Russia’s, is tantamount to a political sensation. But what exactly would this mean in practice? Is Putin really proposing to form a government not from the ranks of professional administrators, as at present, but from individuals brought to power by the voters’ direct will? Or, less glorious but more likely, does he have in mind some kind of return to a one party system, albeit in a new form? It is no secret that the Kremlin wants the United Russia party, its power basis in the Duma, to win the parliamentary elections and form a majority in the lower house.

As the above ramifications might be too complex for the voters to ponder, they were given something almost every family is interested in–a new deadline for reform of the army. The president announced that the term of conscript service would be lowered to one year starting in 2008. This move echoed an election eve announcement by Boris Yeltsin in 1996, when he promised that the army would be organized on a professional basis beginning in 2000. The reduction in the term of military service is clearly something that the electorate wants, but it is worth noting that the president is offering to deliver it only after he is out of office.

The address yielded few surprises in foreign policy. The president stressed familiar themes, including the threat of international terrorism and the need for cooperation through organizations such as the UN. “Today not a single country, whatever its size or wealth, can develop successfully in isolation from the rest of the world,” he said. “On the contrary, only those states which deliberately, intelligently and dynamically integrate into the world economy become successful.” Putin made clear the desired direction of this integration–toward Europe, which he described as a “strategic partner.” There was a deafening silence in the speech regarding the United States. It was not mentioned at all.

If the aim of this pre-election address was to attract voters’ sympathies on the eve of the elections, it fully served the purpose. As to formulating the main directions of the country’s development, that also was accomplished: Everybody could find something that met their expectations in the presidential remark. After all, it did contain all the important themes–on politics, economics and social policy. Now it is up to ordinary Russians themselves to find ways to lift themselves out of poverty, to enjoy the doubled GNP, and to save their sons from the crumbling Russian army.

Elena Chinyaeva holds a doctorate in modern history from Oxford University and is a writer for Kommersant-Vlast, a leading Russian political weekly.